Auto market recovery may take up to 2 years

    Early signs. TMP is back to two-hour shift starting today operating just half its capacity for three months. (File photo)
    Early signs. TMP is back to two-hour shift starting today operating just half its capacity for three months. (File photo)

    Market leader Toyota Motor Philippines Corp. (TMP) will resume two-shift production starting today at its Laguna plant, seeing early signs to normalcy.

    TMP president Hiroshi Okamoto said vehicle sales started picking up in July, indicating a gradual recovery of the entire market.

    Okamoto, however, said it may a year or two for the automotive industry to return to its original market scale.

    Okamoto said TMP’s resumption to two-shift operation is fuelled by the piled up orders for the new Vios, which was launched recently.

    He also attributes the recovery of sales to the strong demand for small cars, in TMP’s case the Vios and the Wigo, a trend that will continue next year and onwards.

    But Okamoto said TMP’s projection of a less than 40-percent decline in sales for the year remains unchanged.

    “The current moment is quite good starting July (through) September. I assume this momentum will continue,” Okamoto said in a press conference at the launch of the new Hilux on September 12,

    The Philippines’ motorization though interrupted by the pandemic will restart depending on the employment and GDP growth, according to Okamoto.

    “On September 14 onwards, we will increase the production volume in Sta. Rosa. That means our production volume and operation and production efficiency are returning to normal (or the) same as before the COVID-19 (new coronavirus disease 2019) pandemic.

    In October, higher level (of production) will continue. After November and onwards, (production) depends on the demand situation,” he added.

    Despite this, TMP is sure it will not be able to hit the production volume of 200,000 units of Vios over the six-year Comprehensive Automotive Resurgence Strategy (CARS).

    Rommel Gutierrez, TMP first vice president, said the company will seek from government an extension on the number of years of CARS but did not indicate for how many more.

    Gutierrez said the pandemic aggravated the soft demand for the Vios which was early on dampened by the introduction of the new excise tax in 2019 and the Taal eruption early this year.

    TMP assembles the Vios and the Innova at a rated capacity of about 66,000 per year.

    The company idled the plant in mid-March due to the enhanced community quarantine and resumed on 50 percent capacity in May.